The red line drawn straight across reveals that the top of the atmosphere bulges up, as the edges do not touch it. The other lines highlight how the atmosphere is actually curving. It's convex, not concave.

That is all within the camera. The atmosphere is a fresnel material on the interior of a sphere. It is absolutely concave. It pinches down where your angle of viewing is at it's lowest, creating a ring around you.

It's the same reason that, on a clear blue ocean, you would have a sense that the horizon curves. It doesn't, it is a flat circle all the way around you. You are equidistant to every point on the horizon. You have a sense of it's curviture due to your viewing angle at that moment. If you turn your head 90 degrees, it looks the same. But the part that you see has "high" now, was "low" a moment ago.

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Originally Posted by sopwithsnipe

Being Star Trek it's more likely that there's a series of facilities along the interior of the hull or satellites in stationary positions that generate an energy field that filters the light to simulates darkness, and the facilities/satellites have an automated pattern on the strength of the filter to generate the day/night cycle.

If that's the case then the real question is if they designed it so while one part of the interior is in darkness another is in daylight OR did they just put the entire interior on day/night schedule so it's day everywhere and night everywhere at the same time.

I doubt we're going to get into that much detail in game. But, essentially creating time zones, where part of the sphere is in the dark and part isn't, is actually pretty problematic. While you would be shielded from the sun, the entire opposite side of the sphere would be lit, and reflecting light onto you, creating an effect that would be more akin to sitting in the shade on a bright day than proper night time.